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NE-MARKAL Model
The NE-MARKAL initiative, which began through a collaboration between NESCAUM and the U.S. EPA Office of Research and Development in 2003, has resulted in the development of a MARKet ALlocation (MARKAL) least-cost optimized linear programing (LP) model which is tailored specifically to the energy infrastructure of several Northeast states. NE-MARKAL is a data-rich analytical framework for examining energy policy options and their resultant impact on energy services in the region. The model serves as the centerpiece of the integrated policy analysis framework developed at NESCAUM which aids in developing a comprehensive understanding of technology, economic, environmental and public health consequences of air quality protection initiatives.
Project Description
NESCAUM, with the assistance of the International Resources Group (IRG), has developed a New England-specific version of the MARKAL model based on regional data and in cooperation with energy and air quality divisions of the respective states. This planning tool allows for the analysis of a range of tranportation, energy and air quality protection programs with a time horizon of 30 years and a focus on the cost and environmental implications of key program design elements.
The NE-MARKAL model responds to prescribed demand for regionally based energy services (in this case, energy required to meet the associated energy service demands of the residential, commercial, industrial and transportation sectors) and selects from available technologies –- characterized by their costs, efficiencies, lifetimes, and maximum utilization rates, along with any user imposed constraints on market penetration, availability, etc. –- to select the least-cost path which satisfies the specified demands. MARKAL is a flexible modeling framework that allows examination of the mid-to-long-term technology choices that shape the evolution of an energy system in meeting specific environmental or other goals. The model allows the implications of specific regional policy options to be examined and compared. Owing to its solid basis in energy economics, MARKAL makes decisions based upon the relative costs of the various technology options and overall system constraints. Thus, it serves to identify the key technologies that will be needed to realize certain GHG- or criteria pollutant-reducing energy/environmental policies and objectives.
The NE-MARKAL model is a linear programming model, similar to DOE’s National Energy Modeling System (NEMS) in that it covers multiple energy demand sectors including residential and commercial buildings, transportation, and the industrial sector, as well as the supply side power generation sector. As NE-MARKAL is expanded to nearby states such as New York, New Jersey and Pennsylvania, resource extraction and conversion technologies (e.g. refineries) can be easily added as well. As opposed to NEMS, however, NE-MARKAL is state-based and regionally specific, with increased regional detail beyond what is currently available in regionalized national energy models. Each New England state is represented as its own region within the model and can be analyzed independently or as a part of the six state collective. Thus, the model is particularly good at demonstrating the benefits of regional cooperation and of flexible implementation of air quality protection programs.
NE-MARKAL is also similar to the Integrated Planning Model (IPM), which has been used for several national regulatory program assessments by the U.S. EPA. IPM does have significant regional detail with respect to the power sector; however, the MARKAL model is multi-sector – as opposed to IPM which only covers the power generation sector – and, thus, is capable of analyzing inter-sectoral tradeoffs among emission reduction programs which may be more or less cost-effective than single sector focused programs. Furthermore, IPM requires that projections for electricity demand be provided exogenously while MARKAL determines said demand endogenously, weighting it against conservation, fuel switching and other options available to the model.
In the latest phase of this project (through NOAA funding of the NCASP program), NESCAUM has expanded this energy/technology model to encompass the 12-state region (extending from Maine to D.C.) that is working together on several policy fronts that deal with climate change, ozone pollution, and visibility impairment by fine particulates. These activities will be directly linked to regional econometric models and emissions processing, air quality and health benefits assessment tools. Together these activities will result in a diverse regional database and associated models, spanning air quality, climate, technology and economics that are of a quality and dimension not presently available. To this end, NE-MARKAL serves to develop sound regional policy and represents a model for replication in other regions of the U.S.
Project Schedule
The New England version of the NE-MARKAL model is available and has been used successfully to examine economy-wide greenhouse gas emissions reduction opportunities in New England as well as specific program opportunities in the transportation sector and the residential heating sector. Plans are underway to release an updated (2002 base-year) 9-state version of the model (including NY, NJ and PA) in January of 2007. Future studies of RPS requirements in the region and complementary policies that would enhance the RGGI program are being pursued as future projects.
Questions or comments regarding this project should be directed to Gary Kleiman or Michelle Manion.